Multiple Choice
Use the following setup for question
Tom wants to avoid any accidents on the work floor of his factory.If an accident does occur,it would cost him $500,000 in damages.Installing safety equipment would decrease the probability of an accident occurring from 20% to 10%.However,the equipment costs $20,000 to install.
-What is his expected loss after installing the safety equipment
A) $20,000
B) $50,000
C) $100,000
D) $125,000
Correct Answer:
Verified
Correct Answer:
Verified
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